Main menu

Tag Archives: bullion

Today whistleblower Andrew Maguire stunned King World News when he said that hedge funds which are heavily short gold will get massacred and may in fact go under. Maguire, who recently appeared in the CBC production “The Secret World of Gold,” also spoke about extraordinary events taking place at the LBMA, where bullion banks are in serious trouble once again. Below is part two of a three part series of extraordinary written interviews that will be released today with Maguire on King World News.

Maguire: “The LBMAbullion stocks are thin. For example, the LBMA delivery conditions were extended from 2 days to 5 days. Why do you think this little known decision to extend delivery times was made at the request of the bullion banks? The fact is that the gold market has been in tight supply for some time now.

There is just very little physical (gold) for sale in size at these current levels. In the past I reported leased gold regularly appeared at the (London) fixes, where the Bank of England would step in at the clearing hour, after the fix, to lend metal to meet these delivery shortfalls….

“Much less of this is now happening. Many of these accrued positions, they already can’t be paid back within the originating terms. So on a short-term basis they have to be rehypothecated, further rolled out, and they match even further out forwards and futures (contracts).

Today whistleblower Andrew Maguire warned King World News that the LBMA is now staring dangerously into the abyss once again. Maguire, who recently appeared in the CBC production “The Secret World of Gold,” described this stunning situation as “very similar to the abyss that Gordon Brown stared into when the Bank of England was forced to bailout Goldman Sachs 13 years ago.” Below is part one of a series of extraordinary written interviews that will be released today with Maguire on King World News.

Maguire: “The mainstream media has this myopic focus on the over 600 tons of GLD redemptions, while in reality we are witnessing massive bullion demand far in excess of these relatively small ETF redemptions. This bullion demand is actually putting enormous pressure upon immediately deliverable LBMAbullion stocks.

What is notable, Eric, is that since the ABNAMRO bank default became public, it forced that defensive attack by the Fed and the Bank for International Settlements….

“I know we talked (on KWN) about it right as it happened, and it forced that defensive attack. It was a desperate attempt to bail out an imminent collapse of the largest bullion houses in London. And despite an over $400 rigged decline in the gold price, Eric, here we are back full circle, with the bullion bank inventories again under stress.

Good luck trying to predict where gold prices are going, because even the head of the world’s most powerful bank admits he hasn’t a clue.

When asked about the drop in gold prices by U.S. senators during his testimony on monetary policy Thursday, U.S. Fed Reserve Ben Bernanke said decline could mean that investors are less worried about the economy. But he hastened to add: “Nobody understands gold prices and I don’t really pretend to understand them either.”

“Gold is an unusual asset. It’s an asset that people hold as a sort of disaster insurance,” Bernanke said in response to a question at a Senate Banking Committee hearing.

“One reason gold prices are lower is people are less concerned about extreme outcomes, particularly negative outcomes, and therefore they feel less need for whatever protection gold affords,” he said . “A lot of people hold gold as an inflation hedge but the movements of gold don’t predict inflation very well actually.”

Ironically, Bernanke may need to look no further than himself for guidance on gold.

Bullion has tumbled more than 20% this year, losing its safe-haven appeal after the U.S. central bank first signalled it would look to rein in its $85 billion in monthly asset purchases later this year and halt stimulus altogether by mid-2014.

The Fed’s three quantitative easing schemes have boosted prices of gold and other commodities, as they kept interest rates low, which weighed on the dollar, making assets priced in U.S. dollars cheaper for foreign investors.

As if to prove Bernanke’s point, spot gold briefly shot up 1% to a session high of US$1,288.06 an ounce Thursday. That’s following a 1% drop the day before.